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Mar 13, 2014

Shell's CEO has pay cut in half after poor performance

New CEO also has pay trimmed to reflect shareholder sentiment
    
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LONDON, U.K. (Reuters) — The pay of Royal Dutch Shell's former chief executive, Peter Voser, halved to $11.24 million (all figures U.S.) last year following what the company described as a disappointing performance.

However, Voser's 2013 remuneration was higher than that of peer BP's chief executive Bob Dudley, whose pay tripled to $8.7 million.

Both men's pay was still below the levels of U.S. rival Exxon Mobil, whose Chief Executive Rex Tillerson pocketed a total $40 million in 2012 according to the latest available figures.

Shell suspended its controversial Arctic drilling programme earlier this year and pledged to cut spending and streamline operations following disappointing earnings in the fourth quarter of 2013 that were the least profitable for five years.

"The business performance in 2013 was disappointing. This is reflected in the reward outcomes for the year," Shell's head of remuneration committee Hans Wijers said on Thursday.

The company said it had also trimmed the base salary of new chief executive, Ben van Beurden, to reflect shareholder sentiment.

He will receive a base salary of 1.4 million euros (US$1.95 million) compared with Voser's 1.64 million euros.

Shell said it will use a new measure for calculating long-term incentive plans to give greater focus to capital efficiency. It will use relative return on average capital employed (ROACE) growth instead of relative hydrocarbon production growth.

Long-term incentive plans together with deferred bonus plans represented more than half the total pay for Shell's executives in the past two years.

Voser, who stepped down from the CEO role at the end of 2013, is currently employed by Shell Switzerland until the end of March as adviser to van Beurden. He will likely receive 635,000 Swiss Francs (US$730,000) for three months' work.

Chief financial officer Simon Henry's pay fell to $5.89 million last year, from $11.65 million.

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